Microsoft is making ready to chop hundreds of jobs subsequent week, persevering with to rein in working prices as the corporate pours unprecedented sums into AI infrastructure.
Enterprise Insider broke the information Tuesday afternoon, saying that the cuts will affect lower than 2.5% of the corporate’s world workforce of about 220,000 folks. It consists of not simply Xbox, the place cuts have been signaled for weeks, but additionally layoffs in gross sales and consulting.
GeekWire confirmed the main points of the report with an individual acquainted with the corporate’s plan. Microsoft isn’t commenting on the report.
The timing follows a well-known sample. Microsoft usually restructures its operations across the shut of its fiscal yr on June 30, and the cuts would come simply as the brand new yr begins.
The reductions had been greater final yr. Microsoft laid off greater than 15,000 folks in two rounds of cuts a number of weeks aside: about 6,000 in Could 2025, then round 9,000 (roughly 4% of the corporate on the time) in early July 2025.
One distinction this yr: Microsoft’s first-ever voluntary retirement program. A couple of third of the roughly 8,750 eligible U.S. workers took the buyout, reportedly permitting the corporate to chop a smaller share of its workforce by means of layoffs than a yr in the past.
The corporate is on tempo to spend greater than $100 billion constructing AI and cloud infrastructure within the fiscal yr that simply ended — up from $88.7 billion the yr earlier than — with about two-thirds going to the chips that energy AI.
Microsoft shares closed Tuesday at $373.02, down 19% over the previous month and close to a 52-week low, as Wall Road questions whether or not its heavy AI spending will repay.
The layoffs come amid a broader wave of restructuring throughout the tech trade, which has shed extra jobs than some other sector this yr. U.S. tech firms have introduced 123,653 cuts up to now in 2026, up 66% from the identical stretch of 2025, in response to a report from outplacement agency Challenger, Grey & Christmas.
Throughout all sectors, not simply tech, AI was probably the most generally cited motive for job cuts in Could — the third straight month it has led the record. The 38,579 cuts attributed to AI had been probably the most in any month since Challenger started monitoring the trigger in 2023. For the yr, AI has been linked to 87,714 cuts, already surpassing the 54,836 attributed to it in all of 2025.
